Nutrien's Shares Rally 17% YTD: What's Driving the Stock?

Nutrien Ltd.’s NTR shares have gained 16.7% so far this year. The company has also outperformed the Zacks Fertilizers industry’s 4.8% rise over the same time frame. 

Let’s take a look into the factors that are driving NTR stock.

Healthy Demand, Acquisitions & Cost Cuts Aid NTR Stock

Nutrien is benefiting from higher demand for fertilizers, backed by the strength in global agriculture markets. It is seeing healthy fertilizer demand in its major markets. Tight inventories are expected to support crop commodity prices in 2025. 

Strong grower economics, improved affordability and low inventory levels are expected to drive potash demand globally. The phosphate market also benefits from higher global demand and low producer and channel inventories. Demand for nitrogen fertilizer also remains healthy in major markets. Global nitrogen requirement is driven by demand in North America, India and Brazil. A resurgence in industrial nitrogen demand also bodes well. The company expects an increase in U.S. corn acreage in 2025 and sees strong demand for crop inputs in the first half.

NTR is also gaining from acquisitions and increased adoption of its digital platform. It continues to expand its footprint in Brazil through acquisitions. It is expected to continue pursuing targeted opportunities in its core markets. The company expects to use a part of its free cash flow in incremental growth investments, including tuck-in acquisitions in retail in 2025.

Cost and operational efficiency initiatives are also aiding the company’s performance. NTR remains focused on lowering the cost of production in the potash business. The company has announced several strategic actions to reduce its controllable costs and boost free cash flow. NTR has accelerated operational efficiency and cost savings initiatives and anticipates achieving around $200 million of total savings in 2025.

Nutrien Ltd. Price and Consensus

Nutrien Ltd. price-consensus-chart | Nutrien Ltd. Quote

NTR’s Zacks Rank & Other Key Picks

NTR currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the Basic Materials space are Carpenter Technology Corporation CRS, DRDGOLD Limited DRD and Idaho Strategic Resources, Inc. IDR. While CRS sports a Zacks Rank #1 (Strong Buy), DRD and IDR carry a Zacks Rank #2 (Buy), each. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Carpenter Technology for the current fiscal year stands at $6.95, reflecting a 46.6% year-over-year increase. CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 15.7%. 

The consensus estimate for DRD’s current-year earnings is pegged at $1.06 per share, indicating a 29.3% year-over-year rise. DRD’s shares have soared roughly 94% in the past year. 

The Zacks Consensus Estimate for Idaho Strategic Resources’ current-year earnings is pegged at 78 cents, suggesting a 16.4% year-over-year rise. IDR surpassed the Zacks Consensus Estimate in three of the trailing four quarters, while missing once, with an average earnings surprise of 77.5%. The company's shares have rallied around 99% in the past year.

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This article originally published on Zacks Investment Research (zacks.com).

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